Gavin Williamson’s sacking as Defence Secretary was not just a great piece of political theatre, but it also demonstrated the seriousness at which the government is treating the future role of Huawei in the UK’s telecoms infrastructure.
Politicians and the mobile industry have been waiting months for a final decision on whether Huawei will be allowed to supply operators with 5G radio equipment, leading to uncertainty. Any ban, the operators argue, would increase prices, reduce innovation, and delay 5G rollout.
Reports based on the leaks from the National Security Council (NSC) suggested that Huawei would not be allowed to provide kit for the core of 5G networks (where the most sensitive data is processed) but it will be able to provide radio equipment.
But if you believe what you read – and Williamson’s departure suggests you can – the cabinet is divided on the issue, fearing that Huawei is a threat to national security. To get to the hear of this multi-faceted debate, there are several political and technical layers that must be unravelled.
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Political intrigue
Shenzhen-based Huawei was founded in the 1980s by Ren Zhengfei, a former engineer in the Chinese military. It bills itself as the first global Chinese company, with its innovative and competitively-priced network gear seeing it carve out significant market share in Asia and Europe.
Huawei is also the world's second largest smartphone manufacturer, with shipments increasing by 50 per cent in the most recent quarter
It sells products to more than 500 operators in 170 countries but has effectively been frozen out of the US market because of Washington’s long-held suspicions. These are largely founded on the firm’s perceived links to the Chinese government and a belief that legislation requires firms in China to assist in state surveillance.
Officials believe that Huawei would be obliged to introduce backdoors that facilitate espionage efforts or could be used to shut down communications networks in the event of hostilities. These fears are heightened by the fact that 5G will enable new types of applications, especially in industry, meaning they will power mission-critical systems and carry more sensitive data.
Huawei has repeatedly denied the allegations, but this hasn’t stopped the US from applying pressure on its allies to follow suit.
The political consequences of a UK decision to allow Huawei’s radio kit to be used shouldn’t be ignored, especially when it comes to the ‘Five Eyes’ intelligence partnership with the US, Australia, Canada and New Zealand. Australia has barred Huawei from 5G, New Zealand has stopped one operator from using the company’s kit, and Canada is considering the matter.
Operator view
The US does not see the difference between the core and the non-core elements of a 5G network and has suggested that information sharing with the UK could be limited if Huawei gear was used in its communications infrastructure.
Williamson was reportedly one of the ministers who raised concerns about the decision to allow Huawei kit to be used for 5G, hence the initial suspicion surrounding him. It could be that whoever leaked the information hoped to influence the final report, which has still yet to be published.
But others note that Huawei has been a significant investor in the UK, which has traditionally welcomed the company, while all four operators are customers.
If the outcome of that report is the same as what has been reported, then it will have no significant impact on the UK’s mobile operators, none of whom plan to use Huawei kit in their 5G core. The fact of the matter is that operators do not regard Huawei as a security risk and plan to use a mixture of kit from all vendors across their radio, transport and core layers.
If operators could not access Huawei’s radio technology, then the UK would cede any leadership position in 5G and widespread availability of services could be delayed by 18-24 months, costing the economy as much as £6.8 billion.
At one point, there seemed to be a real fear at Huawei that the US’s crusade would lead to a domino effect and that Western nations would exclude Huawei one by one. This can help explain the company’s unprecedented publicity blitz in recent months.
It seems to have worked. Other European nations such as Germany and Netherlands have tightened regulations without issuing complete bans, while Huawei sales rose by a fifth to more than $100 billion last year. It has also agreed 40 commercial contracts for 5G, shipping 45,000 base stations in the process.
It seems as though the biggest casualty of this debate might be Mr Williamson.
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